Last year Calmac beat off private sector competition to land a £900m, eight-year contract to run the west-coast ferry network.

Now the Scottish Government is reviewing the procedures over the tendering process for services to the Northern Isles and Dunoon, after the European Commission advised that future contracts could be awarded to an in-house operator without the need for tendering under the ‘Teckal exemption’ – where lifeline services would not apply to normal EU competition rules.

Launching the review last week, Transport Minister Humza Yousaf said: “We would be minded to provide ferry services through an in-house operator, taking account of the communities they serve.”

Speaking about the decision to stay, Dorchester said: “Having discussed the challenges and opportunities presented by this review with the DML Board and with the Transport Minister, I have taken the decision to stay in my current post and lead the organisation through this new chapter.

“I am excited by the opportunities presented by this review and very much look forward to continuing to work with my team and with all of our stakeholders to secure the best possible results for our employees, passengers and communities, as well as the taxpayer.”

David McGibbon, chairman of David MacBrayne Ltd, said: "The board is delighted that Martin will stay to lead the Group throughout what will be an important period. His experience, knowledge and leadership skills will be of great value."